Report: Amazon BTS shoppers are overpaying by 15% | Retail Dive

Much of Amazon’s successful disruption of the retail marketplace came from undercutting traditional retailers on price (notably books in its first retail foray). The stark price competition with brick-and-mortar retailers has largely dissipated as many now price-match (though price wars, especially in consumer products and groceries, continue).

These pricing differences aren’t occurring just because legacy retailers have lowered or price-matched many items, but also because Amazon isn’t competing on price as much anymore.

“Amazon already has a bunch of other prices on its site,” Jason Goldberg, who leads commerce and content strategy at interactive digital agency SapientRazorfish, told Retail Dive last year. “Actually you generally see items being offered by 10 or 20 vendors, so Amazon already has this price competition clearly visible on the page. Those Marketplace sellers are essentially bidding for the lowest price, or the ‘fast follower’ price. [Amazon founder and CEO] Jeff Bezos’s flywheel strategy is to offer a low price, and get more consumers, more sellers and more competition in a virtuous circle.”

But consumers’ expectations that Amazon’s prices will be the best online deal, plus Prime members’ stickiness to the site, may lead many to over-pay on identical items, these studies show.

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Report: Amazon BTS shoppers are overpaying by 15% | Retail Dive.